Covalon Announces Strong Third Quarter Fiscal 2024 Results
Covalon Technologies (TSXV: COV; OTCQX: CVALF) reported strong Q3 fiscal 2024 results, with significant year-on-year growth. Key highlights include:
- Q3 revenue of $9.2 million, up 47% year-on-year
- Q3 gross profit of $5.4 million, up 51% year-on-year
- Q3 EBITDA of $1.7 million and adjusted EBITDA of $2.4 million
- Earnings per share (EPS) of $0.06
The company's performance was driven by expansion in US hospitals and stronger demand for its collagen dressing. Gross margin improved to 59%, while operating expenses decreased due to restructuring efforts. The company's CEO, Brent Ashton, emphasized that these results demonstrate progress on key priorities and the success of foundational work to strengthen Covalon.
Covalon Technologies (TSXV: COV; OTCQX: CVALF) ha riportato risultati solidi per il terzo trimestre dell'anno fiscale 2024, con una significativa crescita anno su anno. I punti salienti includono:
- Entrate del terzo trimestre di 9,2 milioni di dollari, in aumento del 47% rispetto all'anno precedente
- Utile lordo del terzo trimestre di 5,4 milioni di dollari, in aumento del 51% rispetto all'anno precedente
- EBITDA del terzo trimestre di 1,7 milioni di dollari e EBITDA rettificato di 2,4 milioni di dollari
- Utile per azione (EPS) di 0,06 dollari
Le performance dell'azienda sono state sostenute dall'espansione negli ospedali statunitensi e da una domanda più forte per il suo bendaggio in collagene. Il margine lordo è migliorato al 59%, mentre le spese operative sono diminuite grazie agli sforzi di ristrutturazione. Il CEO dell'azienda, Brent Ashton, ha sottolineato che questi risultati dimostrano progressi su priorità chiave e il successo del lavoro di base per rafforzare Covalon.
Covalon Technologies (TSXV: COV; OTCQX: CVALF) reportó resultados sólidos en el tercer trimestre del año fiscal 2024, con un crecimiento significativo año tras año. Los puntos destacados incluyen:
- Ingresos del tercer trimestre de 9,2 millones de dólares, un aumento del 47% en comparación con el año anterior
- Ganancia bruta del tercer trimestre de 5,4 millones de dólares, un aumento del 51% en comparación con el año anterior
- EBITDA del tercer trimestre de 1,7 millones de dólares y EBITDA ajustado de 2,4 millones de dólares
- Beneficio por acción (EPS) de 0,06 dólares
El desempeño de la empresa fue impulsado por la expansión en hospitales de EE. UU. y una mayor demanda de su apósito de colágeno. El margen bruto mejoró al 59%, mientras que los gastos operativos disminuyeron debido a los esfuerzos de reestructuración. El CEO de la empresa, Brent Ashton, destacó que estos resultados demuestran progreso en prioridades clave y el éxito del trabajo fundamental para fortalecer a Covalon.
Covalon Technologies (TSXV: COV; OTCQX: CVALF)는 2024 회계연도 3분기에 강력한 실적을 보고했으며, 전년 대비 상당한 성장을 보였습니다. 주요 내용은 다음과 같습니다:
- 3분기 매출 920만 달러, 전년 대비 47% 증가
- 3분기 총 이익 540만 달러, 전년 대비 51% 증가
- 3분기 EBITDA 170만 달러, 조정된 EBITDA 240만 달러
- 주당순이익(EPS) 0.06 달러
회사의 실적은 미국 병원의 확대와 콜라겐 드레싱에 대한 강한 수요에 의해 추진되었습니다. 총 이익률은 59%로 상승했으며, 운영 비용은 구조조정 노력 덕분에 감소했습니다. 회사의 CEO인 Brent Ashton은 이러한 결과가 주요 우선사항에 대한 진행 상황을 보여주며 Covalon을 강화하기 위한 기초 작업의 성공을 입증한다고 강조했습니다.
Covalon Technologies (TSXV: COV; OTCQX: CVALF) a rapporté des résultats solides pour le troisième trimestre de l'exercice 2024, avec une croissance significative d'une année sur l'autre. Les faits saillants comprennent :
- Chiffre d'affaires du troisième trimestre de 9,2 millions de dollars, en hausse de 47 % par rapport à l'année précédente
- Bénéfice brut du troisième trimestre de 5,4 millions de dollars, en hausse de 51 % par rapport à l'année précédente
- EBITDA du troisième trimestre de 1,7 million de dollars et EBITDA ajusté de 2,4 millions de dollars
- Bénéfice par action (BPA) de 0,06 dollar
Les performances de l'entreprise ont été soutenues par l'expansion dans les hôpitaux américains et une demande plus forte pour son bandage en collagène. La marge brute s'est améliorée à 59 %, tandis que les dépenses d'exploitation ont diminué en raison d'efforts de restructuration. Le PDG de la société, Brent Ashton, a souligné que ces résultats démontrent des progrès sur des priorités clés et le succès des travaux fondamentaux pour renforcer Covalon.
Covalon Technologies (TSXV: COV; OTCQX: CVALF) berichtete von starken Ergebnissen im dritten Quartal des Geschäftsjahres 2024, mit einem signifikanten Wachstum im Jahresvergleich. Die wichtigsten Highlights sind:
- Quartalsumsatz von 9,2 Millionen Dollar, ein Anstieg um 47% im Vergleich zum Vorjahr
- Bruttogewinn des dritten Quartals von 5,4 Millionen Dollar, ein Anstieg um 51% im Vergleich zum Vorjahr
- EBITDA im dritten Quartal von 1,7 Millionen Dollar und angepasstes EBITDA von 2,4 Millionen Dollar
- Ergebnis je Aktie (EPS) von 0,06 Dollar
Die Leistung des Unternehmens wurde durch die Expansion in US-Krankenhäuser und eine stärkere Nachfrage nach seinem Kollagenverband vorangetrieben. Die Bruttomarge verbesserte sich auf 59%, während die Betriebskosten aufgrund von Restrukturierungsmaßnahmen sanken. Der CEO des Unternehmens, Brent Ashton, betonte, dass diese Ergebnisse Fortschritte bei den wichtigsten Prioritäten und den Erfolg grundlegender Arbeiten zur Stärkung von Covalon zeigen.
- Q3 revenue increased 47% year-on-year to $9.2 million
- Q3 gross profit grew 51% year-on-year to $5.4 million
- Q3 EBITDA of $1.7 million and adjusted EBITDA of $2.4 million
- Earnings per share (EPS) of $0.06
- Gross margin improved to 59% from 57% in the prior year
- Operating expenses decreased to $4.0 million from $4.2 million in the prior year
- Product revenue increased 53% year-on-year
- Nine-month revenue increased 13% to $22.3 million
- Inventory provisions of $424,606 recorded due to changes in obsolescence estimates
- General and administrative expenses increased to $1.6 million from $1.4 million in the prior year
- Research and development expenses increased to $378,647 from $365,922 in the prior year
Progress on key priorities drives outstanding performance
-
Q3 EBITDA of
, adjusted EBITDA of$1.7 million , and EPS of$2.4 million $0.06
-
Q3 Revenue of
, year-on-year growth of$9.2 million 47%
-
Q3 Gross Profit of
, year-on-year growth of$5.4 million 51%
“We delivered a very successful Q3 – solid performance on growth, margins and operating expenses all led to another strong quarter of profitability,” said Brent Ashton, Covalon’s Chief Executive Officer. “Our results clearly demonstrate the progress that the One Covalon team is making against our key priorities, and that the foundational work to strengthen Covalon is delivering value to our customers, stakeholders, and investors.”
Conference Call Scheduled
A conference call and webcast to discuss Covalon’s third quarter fiscal 2024 financial results will be held on Wednesday, August 21 at 8:30am Eastern Time. To view, listen to, and participate in the live webcast, please follow the link below:
https://events.q4inc.com/attendee/177616087
To listen and participate via the conference call, please dial:
North American Toll-Free: 1-800-549-8228
Local (
Local (
Conference ID: 69066
Participants will be able to ask questions of Company management during the Q&A portion of the conference call.
A recording of the call will also be available on www.covalon.com under Financials on the Investors tab.
Financial Performance
For the three-month period ended June 30, 2024:
Total revenue increased
Gross margin increased to
Operating expenses decreased to
Operations department expenses, comprising of Quality Control, Quality Assurance, Production, and Regulatory activities, decreased to
Research and development expenses increased to
Sales and marketing expenses decreased
General and administrative expenses increased to
Wages, benefits, and consulting fees (for all departments) include a non-cash expense related to stock-based compensation. During the three months ended June 30, 2024, stock-based compensation expense was
For the nine-month period ended June 30, 2024:
Total revenue increased by
Gross Margin increased to
Operating expenses decreased to
Operations department expenses, comprising of Quality Control, Quality Assurance, Production, and Regulatory activities, increased to
Research and development expenses increased to
Sales and marketing costs decreased to
General and administrative expenses increased to
During the nine months ended June 30, 2024, stock-based compensation expense was
Q3 Financial Overview
Statement of Operations
The following audited table presents Covalon’s consolidated statements of operations for the three- and nine-month periods ended June 30, 2024 and 2023:
Three months ended June 30, |
|
Nine months ended June 30, |
||||||
|
2024 |
2023 |
|
2024 |
2023 |
|||
Revenue |
|
|
|
|
|
|||
Product |
|
|
|
|
|
|||
Development and consulting services |
- |
205,169 |
|
56,540 |
2,131,981 |
|||
Licensing and royalty fees |
17,499 |
30,218 |
|
73,837 |
182,447 |
|||
|
|
|
|
|
|
|||
Total revenue |
9,224,307 |
6,270,039 |
|
22,300,974 |
19,700,038 |
|||
|
|
|
|
|
|
|||
Cost of sales |
3,792,582 |
2,665,602 |
|
8,710,250 |
8,228,741 |
|||
|
|
|
|
|
|
|||
Gross profit |
5,431,725 |
3,604,437 |
|
13,590,724 |
11,471,297 |
|||
|
|
|
|
|
|
|||
Operating expenses |
|
|
|
|
|
|||
Operations |
608,476 |
627,001 |
|
1,662,428 |
1,377,635 |
|||
Research and development activities |
378,647 |
365,922 |
|
1,140,568 |
931,388 |
|||
Sales, marketing, and agency fees |
1,387,869 |
1,826,912 |
|
4,297,132 |
6,066,742 |
|||
General and administrative |
1,581,319 |
1,372,243 |
|
5,003,939 |
4,760,815 |
|||
|
3,956,311 |
4,192,078 |
|
12,104,067 |
13,136,580 |
|||
|
|
|
|
|
|
|||
Finance expenses (income) |
27,364 |
(85,874) |
|
39,740 |
(84,614) |
|||
Gain on finance lease receivable |
- |
- |
(610,008) |
- |
||||
|
|
|
|
|
|
|||
Net income (loss) |
|
|
|
|
|
|||
Other comprehensive income (loss) |
|
|
|
|
||||
Amount that may be reclassified to profit or loss |
||||||||
|
|
|
|
|
||||
Foreign currency translation adjustment |
287,426 |
(235,941) |
|
476,331 |
(499,249) |
|||
|
|
|
|
|
|
|||
Total comprehensive income (loss) |
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Income (loss) per common share |
||||||||
Basic income (loss) per share (Note 16) |
|
|
|
|
|
|||
Diluted income (loss) per share (Note 16) |
|
|
|
|
|
|||
Non-GAAP Financial Measures
This press release makes reference to certain non-GAAP measures. These measures are not recognized or defined measures under IFRS Accounting Standards, do not have standardized meaning prescribed by IFRS Accounting Standards and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional financial information to complement those IFRS Accounting Standards measures by providing further understanding of our results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation or as a substitute for analysis of our financial information reported under IFRS Accounting Standards. The non-GAAP financial measures, adjustments, and reasons for adjustments should be carefully evaluated as these measures have limitations as analytical tools and should not be used in substitution for an analysis of the Company’s results under IFRS Accounting Standards. We use non-GAAP measures including “Adjusted Gross Margin” and “Adjusted EBITDA” to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS Accounting Standards measures. We believe that securities analysts, investors and other interested parties frequently use non-GAAP measures in the evaluation of issuers. Our management also uses non-GAAP measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. The following non-GAAP financial measures are presented in this news release, and a description of the calculation for each measure is included below:
- Adjusted Gross Margin is defined as gross profit before operating expenses, plus depreciation and amortization included in cost of sales, plus inventory provision amounts.
- Adjusted EBITDA as earnings (loss) before interest expense (income), depreciation and amortization, stock-based compensation, inventory provisions (reversals), accounts receivable write-offs, gain (loss) on finance lease receivable, and loss (gain) on disposal of property and equipment.
You should also be aware that the Company may recognize income or incur expenses in the future that are the same as, or similar to some of the adjustments in these non-GAAP financial measures. Because these non-GAAP financial measures may be defined differently by other companies in our industry, our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.
The table below provides a reconciliation of gross profit before operating expenses under IFRS Accounting Standards in the consolidated financial statements to Adjusted Gross Margin for the three months, and nine months ended June 30, 2024 and 2023. Management believes that Adjusted Gross Margin is useful in assessing the performance of the Company’s ongoing operations and its ability to generate cash flows from period to period. The adjusting items below are considered to be outside of the Company’s core operating results, and these items can distort the trends associated with the Company’s ongoing performance, even though some of those expenses may recur.
|
Three months ended June 30, |
Nine months ended June 30, |
||
|
2024 |
2023 |
2024 |
2023 |
Gross profit before operating expenses |
|
|
|
|
Add: Depreciation and amortization |
58,017 |
59,466 |
168,887 |
168,560 |
Add: Inventory provisions (reversals) |
424,606 |
(221,225) |
906,701 |
(379,949) |
Adjusted Gross Margin |
5,914,348 |
3,442,678 |
14,666,312 |
11,259,908 |
Adjusted Gross Margin (%) |
|
|
|
|
The table below provides a reconciliation of net loss under IFRS Accounting Standards in the consolidated financial statements to Adjusted EBITDA for the three and nine months ended June 30, 2024 and 2023. Management believes that these non-GAAP measures are useful in assessing the performance of the Company’s ongoing operations and its ability to generate cash flows to fund its cash requirements from period to period. The adjusting items below are considered to be outside of the Company’s core operating results, and these items can distort the trends associated with the Company’s ongoing performance, even though some of those expenses may recur.
|
Three months ended June 30, |
Nine months ended June 30, |
||
|
2024 |
2023 |
2024 |
2023 |
Net income (loss) |
|
( |
|
( |
Add: Finance expense (income) |
27,364 |
(85,874) |
39,740 |
(84,614) |
Add: Depreciation and amortization |
246,416 |
271,184 |
734,366 |
754,604 |
Add: Stock based compensation |
150,100 |
107,825 |
347,493 |
437,282 |
Add: Inventory provisions (reversals) |
424,606 |
(221,225) |
906,701 |
(379,949) |
Add: Loss (gain) on disposal of property and equipment |
85,021 |
- |
85,021 |
- |
Add: Loss (gain) of finance lease receivable |
- |
- |
(610,008) |
- |
Adjusted EBITDA |
|
( |
|
( |
About Covalon
Covalon is a patient-driven medical device company, that provides innovative and cost-effective healthcare solutions for advanced wound care, infection control, and medical device coatings. Through a strong portfolio of patented technologies and solutions, we offer innovative, gentle and more compassionate options to aid patients on their healing journey. Our solutions are designed for patients and made for care providers. Covalon leverages its patented medical technology platforms and expertise in two ways: (i) by developing products that are sold under Covalon’s name; and (ii) by developing and commercializing medical products for other medical companies under development and license contracts. The Company is listed on the TSX Venture Exchange, having the symbol COV and trades on the OTCQX Market under the symbol CVALF. To learn more about Covalon, visit our website at www.covalon.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain forward-looking statements which reflect the Company's current expectations regarding future events. The forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan, "estimate", "expect", "intend", or variations of such words and phrases or state that certain actions, events, or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur”, or “be achieved”. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts, but instead represent management’s expectations, estimates, and projections regarding future events. Forward-looking statements involve risks and uncertainties, including, but not limited to, the factors described in greater detail in the “Risks and Uncertainties” section of our management’s discussion and analysis of financial condition and results of operations for the year ended September 30, 2023, which is available on the Company’s profile at www.sedarplus.ca, any of which could cause results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. Investors should not place undue reliance on any forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this news release, and the Company assumes no obligation to update or alter any forward-looking statements, whether as a result of new information, further events, or otherwise, except as required by law.
(1) |
See “Non-GAAP Measures” below, including for a reconciliation of the non-GAAP measures used in this release to the most comparable IFRS Accounting Standards measures. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240821321173/en/
To learn more about Covalon, please contact:
Investor Relations, Covalon Technologies Ltd.
Email: investors@covalon.com
Website: https://covalon.com/
Source: Covalon Technologies Ltd.
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